Commercial real estate contract disputes

A failed closing can involve competing accounts of what the agreement required and why the transaction did not proceed. Disputes may concern closing documents, title objections, financing conditions, due diligence, extensions or a party's claimed failure to perform.

James examines the operative agreement and the transaction record to determine which obligations were due, whether conditions were satisfied and what the parties communicated before and after the scheduled closing. Amendments and notices may be as important as the original purchase agreement.

James represented Chadco of Duluth in the district court and in the published appeal in First & First, LLC v. Chadco of Duluth, LLC, 999 N.W.2d 553 (Minn. App. 2023).

The dispute arose from the proposed purchase of Duluth's Spirit Valley Mall. The purchaser sought a temporary injunction to stop cancellation of the purchase agreement. The Minnesota Court of Appeals affirmed denial of that request, holding that irreparable harm must be demonstrated rather than presumed because the dispute involves real estate.

Read the published Chadco opinion

A cancellation notice can require attention before the underlying contract dispute would ordinarily reach trial. The review should identify the asserted default, the governing procedure, the deadline stated in the notice and the steps available to address it.

Minnesota's contract cancellation statute sets requirements that may apply to termination of a real estate purchase agreement. The applicable procedure depends on the agreement and circumstances. Continued negotiations should not be assumed to extend a contractual or statutory deadline.

Minnesota law authorizes courts to temporarily restrain or enjoin statutory termination in qualifying circumstances, subject to the governing procedural requirements. A disagreement about the contract does not by itself suspend the cancellation process.

James evaluates the evidence supporting or opposing temporary relief, the transaction deadlines and the practical consequences of the requested order. The Chadco appeal illustrates the importance of establishing the required grounds for an injunction.

When a transaction fails, the parties may disagree over the treatment of earnest money, the effect of a default or the relief available under the agreement. Some disputes seek financial recovery; others seek enforcement of the transaction or a determination of the parties' rights.

The analysis starts with the actual contract provisions, the parties' conduct and the applicable law. We assess the requested remedy alongside the evidence needed to support or oppose it.

Useful starting materials include the signed purchase agreement, every amendment, title and survey materials, relevant closing documents, default or cancellation notices, and communications concerning performance or extensions.

A clear chronology should distinguish agreed changes from proposals that were never accepted. Identify any scheduled closing, notice deadline, pending motion or court hearing when contacting the firm.

James's commercial real estate work complements his construction litigation and outside general counsel practice. He helps contractors, developers and other businesses address the agreements and relationships underlying their operations.

A transaction dispute may be one part of a larger project or business relationship. The litigation strategy should account for that broader context and the client's objectives.

Contact James Magnuson about a disputed purchase agreement, failed closing or cancellation notice. Contact the firm first to arrange a conflict check and an appropriate way to share documents.

James Magnuson
james@mjblawmn.com
612-716-3099

Construction law & contractor counsel